Business

Hope for devastating child disease comes at a cost: $750,000 a year

Kernan and Braeden Farrell, who have spinal muscular atrophy, arrived home from school in Newburyport.

John Blanding/Globe staff

Kernan and Braeden Farrell, who have spinal muscular atrophy, arrived home from school in Newburyport.

Parents of children with a rare disease called spinal muscular atrophy were thrilled two days before Christmas, when regulators approved the first drug to treat the condition that often kills patients before their second birthday.

But in the three months since, some parents in Massachusetts have fought to get their insurer, Neighborhood Health Plan, to pay for the medicine, an enormously expensive drug called Spinraza and made by Cambridge-based Biogen Inc.

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The drug’s list price of $750,000 for the first year, and $375,000 annually after that, makes it one of the costliest medicines on the market.

Last week, the parents of a Newburyport girl won a ruling that orders coverage for the drug — but it appears to be a decision that applies only to their case.

The jockeying over reimbursement for Spinraza has become a familiar scenario in the world of breakthrough drugs, reflecting a gulf between patients’ hopes and business realities.

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Insurers are demanding stronger evidence to justify the prices of these sorts of drugs. Recently, for example, some have balked at paying for a new drug that prevents strokes and another that treats Duchenne muscular dystrophy. Historically, insurers have usually covered the cost of new medicines for rare diseases with no other treatments.

Drug makers contend that their high prices are justified by the many millions of dollars they sink into research and testing on experimental medicines, many of which never make it to clinical trials.

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In the case of Spinraza, a state patient protection panel ruled this month that Neighborhood Health was wrong to deny coverage to Kernan Farrell, 4, of Newburyport, who is suffering from a less-critical type of the condition. Her parents, Kristen and Jim Farrell, turned to the Health Policy Commission after losing an in-house appeal to Neighborhood Health.

Neighborhood Health must comply with the decision, said Matthew Kitsos, a spokesman for the commission, but it doesn’t set a precedent; appeals for coverage from other patients with spinal muscular atrophy, known as SMA, will be considered individually.

Neighborhood Health said it will only cover patients with the most severe form of the disease, until it gets more data about how well the drug works.

Meantime, the insurer continues to reject coverage for patients with less severe forms of the condition, which destroys the muscles of more than 10,000 children in the United States.

Neighborhood Health Plan, which lost more than $100 million last year, said it bases its decisions on Spinraza cases purely on medical criteria. The insurer, which is owned by Partners HealthCare, the largest health network in the state, said it will reassess its position as new information about the injectable drug becomes available.

That means other families are still scrambling to figure out how, or whether, they’ll get access to the new treatment, prescribed by neurologists at Boston Children’s Hospital and other medical centers.

Tyler Hansen, who suffers from spinal muscular atrophy, wrestled with his father, Doug, at their home in Boston.

Keith Bedford/Globe Staff

Tyler Hansen, who suffers from spinal muscular atrophy, wrestled with his father, Doug, at their home in Boston.

SMA disables the nerve signals controlling muscle movement. In clinical trials, Spinraza helped children stricken with SMA to hold up their heads, sit up, stand on their own, and walk short distances.

“This is something that could help our son Tyler,” said Boston consultant Doug Hansen, who last week learned he had lost his appeal to Neighborhood Health of its denial of Spinraza coverage for his 11-year-old. “It could stop or dramatically reduce the progression of the disease.”

Tyler was diagnosed with SMA in 2015 after his parents noticed he was falling several times a day. “He would just drop,” said his mother, Kim. “It was like his legs would give out.”

Doug said he, like the Farrells did, will bring his case to the Health Policy Commission unless the insurer changes its decision.

Navigating the bureaucracy around SMA treatments has become a necessary practice for such families as the Farrells. In addition to Kernan, their 5-year-old son, Braeden, also has the condition. Kristen Farrell said that before her children were diagnosed, she had never heard of the disease, which affects about one in every 10,000 infants.

Braeden, who was diagnosed when he was 15 months old, walks with a brace but typically moves about in a wheelchair powered by a small motor. He has been able to receive spinal injections of Spinraza through a clinical trial at Boston Children’s since he was 2½ years old, and it has helped him hold up his head, open a cup lid, and hug his parents. His sister Kernan, diagnosed three weeks after she was born, is still walking but has difficulty balancing and falls frequently.

Neighborhood Health declined to make executives available for an interview, but in a statement the insurer said it considers only evidence of “safety and efficacy” when ruling on what drugs to cover for which patients.

It offered a partial explanation for the distinctions it draws in denial letters to the families.

Tyler’s family is appealing a decision to deny coverage for a drug to slow his muscular disease.

Keith Bedford/Globe Staff

Tyler’s family is appealing a decision to deny coverage for a drug to slow his muscular disease.

The insurer’s drug review panel determined that Biogen had demonstrated Spinraza’s effectiveness only for Type 1 SMA patients — those most severely affected. In its denial letters, Neighborhood Health said Type 3 — the form that Tyler Hansen and Kernan Farrell have — wasn’t the focus of Biogen’s study of the drug. It said the clinical data its panel reviewed “does not meet our medical necessity criteria” for Type 3, which typically affects children who learn to stand and walk, but eventually lose that ability.

But when it approved the drug for US sales on Dec. 23, the Food and Drug Administration specified it was approved for all children with SMA. Biogen, in fact, submitted clinical data to the agency showing the drug’s effectiveness in children with less severe forms of the disease, though its tests didn’t compare those patients with others taking a placebo, as they did with Type 1 patients. It is continuing to test the drug on later-onset patients.

The health plan’s policy is “just not right,” said Kristen Farrell, a sign language interpreter. “We feel lucky there’s a treatment now, and there’s good science behind it.”

In its statement, Neighborhood Health said it could not discuss specific cases because of privacy concerns. It said the insurer’s pharmacy and therapeutics committee, staffed by independent doctors and pharmacists, followed a “rigorous process” in concluding it should cover Spinraza only for Type 1 patients.

Dr. Basil Darris, director of the SMA program at Boston Children’s, who ran the hospital’s clinical trials of Spinraza, said the existing data are strong enough for him to prescribe the drug for all patients with the disease.

“We’re happy that we now have a drug for these patients, and we can see the benefits,” Darris said. “There’s an urgency here.”

While insurers have stepped up their criticism of high drug prices, many — including Aetna and United HealthGroup, two of the nation’s biggest carriers — are covering Spinraza for all patients. Biogen chief executive Michel Vounatsos told a health care conference earlier this month that more than 50 regional and national health plans will pay for the drug. Other insurers, including about 20 Medicaid plans nationally, are evaluating Spinraza claims case by case.

That’s the approach the three largest Massachusetts health insurers — Blue Cross and Blue Shield, Harvard Pilgrim, and Tufts Health Plan — are taking for now. All five Blue Cross members in Massachusetts who requested Spinraza — including some Type 3 patients — were approved for coverage, said senior vice president Jay McQuaide.

Biogen spokesman Todd Cooper said the cost of Spinraza is “in line with what we’ve seen in other orphan therapies” — new drugs that treat rare genetic diseases for which there are no other treatments. The company subsidizes the cost to qualified patients who don’t have insurance, but the subsidies don’t cover the steep cost of the injection procedure itself.

The Farrell family has won a ruling that requires its insurer to cover medicine for Kernan (second left). Her brother, Braeden, receives the drug in a clinical trial.

John Blanding/Globe Staff

The Farrell family has won a ruling that requires its insurer to cover medicine for Kernan (second left). Her brother, Braeden, receives the drug in a clinical trial.

Robert Weisman can be reached at robert.weisman@globe.com. Follow him on Twitter @GlobeRobW.
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